Microsoft Corporation · Earnings release · 8-K Exhibit 99

EX-99.1 2 msft-ex99_1.htm EX-99.1 EX-99.1 Exhibit 99.1 Microsoft Cloud and AI Strength Fuels Fourth Quarter Results REDMOND, Wash. — July 30, 2025 — Microsoft Corp. today announced the following results for the quarter ended June 30, 2025, as compared to the corresponding period of last fiscal year: • Revenue was $76.4 billion and increased 18% (up 17% in constant currency) • Operating income was $34.3 billion and increased 23% (up 22% in constant currency) • Net income was $27.2 billion and increased 24% (up 22% in constant currency) • Diluted earnings per share was $3.65 and increased 24% (up 22% in constant currency) “T1Cloud and AI is the driving force of business transformation across every industry and sector,” said Satya Nadella, chairman and chief executive officer of Microsoft. “We’re innovating across the tech stack to help customers adapt and grow in this new era, and this year, T2Azure surpassed $75 billion in revenue, up 34 percent, driven by growth across all workloads.” “We closed out the fiscal year with a strong quarter, highlighted by Microsoft Cloud revenue reaching $46.7 billion, up 27% (up 25% in constant currency) year-over-year,” said Amy Hood, executive vice president and chief financial officer of Microsoft.

Business Highlights Revenue in Productivity and Business Processes was $33.1 billion and increased 16% (up 14% in constant currency), with the following business highlights: • T3Microsoft 365 Commercial products and cloud services revenue increased 16% (up 15% in constant currency) driven by Microsoft 365 Commercial cloud revenue growth of 18% (up 16% in constant currency) • T4Microsoft 365 Consumer products and cloud services revenue increased 21% driven by Microsoft 365 Consumer cloud revenue growth of 20% • LinkedIn revenue increased 9% (up 8% in constant currency) • Dynamics products and cloud services revenue increased 18% (up 17% in constant currency) driven by Dynamics 365 revenue growth of 23% (up 21% in constant currency) Revenue in Intelligent Cloud was $29.9 billion and increased 26% (up 25% in constant currency), with the following business highlights: • T5Server products and cloud services revenue increased 27% driven by Azure and other cloud services revenue growth of 39% Revenue in More Personal Computing was $13.5 billion and increased 9%, with the following business highlights: • Windows OEM and Devices revenue increased 3% • Xbox content and services revenue increased 13% (up 12% in constant currency) • Search and news advertising revenue excluding traffic acquisition costs increased 21% (up 20% in constant currency) T6Microsoft returned $9.4 billion to shareholders in the form of dividends and share repurchases in the fourth quarter of fiscal year 2025.     Fiscal Year 2025 Results Microsoft Corp. today announced the following results for the fiscal year ended June 30, 2025, as compared to the corresponding period of last fiscal year: • Revenue was $281.7 billion and increased 15% • Operating income was $128.5 billion and increased 17% (up 18% in constant currency) • Net income was $101.8 billion and increased 16% (up 15% in constant currency) • Diluted earnings per share was $13.64 and increased 16% Business Outlook Microsoft will provide forward-looking guidance in connection with this quarterly earnings announcement on its earnings conference call and webcast.

Quarterly Highlights, Product Releases, and Enhancements Every quarter Microsoft delivers hundreds of products, either as new releases, services, or enhancements to current products and services. These releases are a result of significant research and development investments, made over multiple years, designed to help customers be more productive and secure and to deliver differentiated value across the cloud and the edge. Here are the major product releases and other highlights for the quarter, organized by product categories, to help illustrate how we are accelerating innovation across our businesses while expanding our market opportunities. Webcast Details Satya Nadella, chairman and chief executive officer, Amy Hood, executive vice president and chief financial officer, Alice Jolla, chief accounting officer, Keith Dolliver, corporate secretary and deputy general counsel, and Jonathan Neilson, vice president of investor relations, will host a conference call and webcast at 2:30 p.m.

Pacific time (5:30 p.m. Eastern time) today to discuss details of the company’s performance for the quarter and certain forward-looking information. The session may be accessed at http://www.microsoft.com/en-us/investor . The webcast will be available for replay through the close of business on July 30, 2026. Constant Currency Microsoft presents constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars using the average exchange rates from the comparative period rather than the actual exchange rates in effect during the respective periods.

All growth comparisons relate to the corresponding period in the last fiscal year. Microsoft has provided this non-GAAP financial information to aid investors in better understanding our performance. The non-GAAP financial measures presented in this release should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP.     Financial Performance Constant Currency Reconciliation   Three Months Ended June 30,                                      ($ in millions, except per share amounts)   Revenue   Operating Income   Net Income   Diluted Earnings per Share                                     2024 As Reported (GAAP)   $64,727   $27,925   $22,036   $2.95 2025 As Reported (GAAP)   $76,441   $34,323   $27,233   $3.65 Percentage Change Y/Y (GAAP)   18%   23%   24%   24% Constant Currency Impact   $619   $326   $356   $0.05 Percentage Change Y/Y Constant Currency   17%   22%   22%   22%     Twelve Months Ended June 30,                                      ($ in millions, except per share amounts)   Revenue   Operating Income   Net Income   Diluted Earnings per Share                                     2024 As Reported (GAAP)   $245,122   $109,433   $88,136   $11.80 2025 As Reported (GAAP)   $281,724   $128,528   $101,832   $13.64 Percentage Change Y/Y (GAAP)   15%   17%   16%   16% Constant Currency Impact   $(485)   $(351)   $56   $0.01 Percentage Change Y/Y Constant Currency   15%   18%   15%   16% Segment Revenue Constant Currency Reconciliation   Three Months Ended June 30,                              ($ in millions)   Productivity and Business Processes   Intelligent Cloud   More Personal Computing                             2024 As Reported (GAAP)   $28,627   $23,785   $12,315 2025 As Reported (GAAP)   $33,112   $29,878   $13,451 Percentage Change Y/Y (GAAP)   16%   26%   9% Constant Currency Impact   $368   $184   $67 Percentage Change Y/Y Constant Currency   14%   25%   9% We have recast certain prior period amounts to conform to the way we internally manage and monitor our business.     Selected Product and Service Revenue Constant Currency Reconciliation   Three Months Ended June 30, 2025                               Percentage Change Y/Y (GAAP)   Constant Currency Impact   Percentage Change Y/Y Constant Currency                             Microsoft Cloud   27%   (2)%   25% Microsoft 365 Commercial products and cloud services   16%   (1)%   15% Microsoft 365 Commercial cloud   18%   (2)%   16% Microsoft 365 Consumer products and cloud services   21%   0%   21% Microsoft 365 Consumer cloud   20%   0%   20% LinkedIn   9%   (1)%   8% Dynamics products and cloud services   18%   (1)%   17% Dynamics 365   23%   (2)%   21% Server products and cloud services   27%   0%   27% Azure and other cloud services   39%   0%   39% Windows OEM and Devices   3%   0%   3% Xbox content and services   13%   (1)%   12% Search and news advertising excluding traffic acquisition costs   21%   (1)%   20%   About Microsoft Microsoft (Nasdaq “MSFT” @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers.

The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more. Forward-Looking Statements Statements in this release that are “forward-looking statements” are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of factors such as: • T7intense competition in all of our markets that could adversely affect our results of operations; • focus on cloud-based and AI services presenting execution and competitive risks; • significant investments in products and services that may not achieve expected returns; • acquisitions, joint ventures, and strategic alliances that could have an adverse effect on our business; • cyberattacks and security vulnerabilities that could lead to reduced revenue, increased costs, liability claims, or harm to our reputation or competitive position; • disclosure and misuse of personal data that could cause liability and harm to our reputation; • the possibility that we may not be able to protect information in our products and services from use by others; • abuse of our advertising, professional, marketplace, or gaming platforms that may harm our reputation or user engagement; • products and services, how they are used by customers, and how third-party products and services interact with them, presenting security, privacy, and execution risks; • issues about the use of AI in our offerings that may result in reputational or competitive harm, or liability; • excessive outages, data losses, and disruptions of our online services if we fail to maintain an adequate operations infrastructure; • supply or quality problems;     • potential consequences of new, existing, and evolving legal and regulatory requirements; • claims against us that could result in adverse outcomes in legal disputes; • uncertainties relating to our business with government customers; • additional tax liabilities; • an inability to protect and utilize our intellectual property may harm our business and operating results; • claims that Microsoft has infringed the intellectual property rights of others; • damage to our reputation or our brands that may harm our business and results of operations; • adverse economic or market conditions that could harm our business; • catastrophic events or geopolitical conditions, such as the COVID-19 pandemic, that could disrupt our business; • exposure to increased economic and operational uncertainties from operating a global business, including the effects of foreign currency exchange; and • the dependence of our business on our ability to attract and retain talented employees.

For more information about risks and uncertainties associated with Microsoft’s business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of Microsoft’s SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting Microsoft’s Investor Relations department at (800) 285-7772 or at Microsoft’s Investor Relations website at http://www.microsoft.com/en-us/investor . All information in this release is as of June 30, 2025. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations.

For more information, press only: Microsoft Media Relations, WE Communications for Microsoft, (425) 638-7777, rrt@we-worldwide.com For more information, financial analysts and investors only: Jonathan Neilson, Vice President, Investor Relations, (425) 706-4400 Note to editors: For more information, news and perspectives from Microsoft, please visit the Microsoft News Center at http://www.microsoft.com/news . Web links, telephone numbers, and titles were correct at time of publication, but may since have changed. Shareholder and financial information, as well as today’s 2:30 p.m. Pacific time conference call with investors and analysts, is available at http://www.microsoft.com/en-us/investor .     MICROSOFT CORPORATION   INCOME STATEMENTS (In millions, except per share amounts) (Unaudited)     Three Months Ended June 30,   Twelve Months Ended June 30,   2025   2024   2025   2024                                     Revenue:                 Product   $17,136   $13,217   $63,946   $64,773 Service and other   59,305   51,510   217,778   180,349                                     Total revenue   76,441   64,727   281,724   245,122                                     Cost of revenue:                 Product   3,314   1,438   13,501   15,272 Service and other   20,700   18,246   74,330   58,842                                     Total cost of revenue   24,014   19,684   87,831   74,114                                     Gross margin   52,427   45,043   193,893   171,008 Research and development   8,829   8,056   32,488   29,510 Sales and marketing   7,285   6,816   25,654   24,456 General and administrative   1,990   2,246   7,223   7,609                                     Operating income   34,323   27,925   128,528   109,433 Other expense, net   (1,707)   (675)   (4,901)   (1,646)                                     Income before income taxes   32,616   27,250   123,627   107,787 Provision for income taxes   5,383   5,214   21,795   19,651                                     Net income   $27,233   $22,036   $101,832   $88,136                                     Earnings per share:                 Basic   $3.66   $2.96   $13.70   $11.86 Diluted   $3.65   $2.95   $13.64   $11.80                   Weighted average shares outstanding:                 Basic   7,432   7,433   7,433   7,431 Diluted   7,461   7,472   7,465   7,469                         COMPREHENSIVE INCOME STATEMENTS (In millions) (Unaudited)     Three Months Ended   Twelve Months Ended   June 30,   June 30,   2025   2024   2025   2024                                     Net income   $27,233   $22,036   $101,832   $88,136                                     Other comprehensive income (loss), net of tax:                 Net change related to derivatives   (9)   (4)   (5)   24 Net change related to investments   444   88   1,574   957 Translation adjustments and other   1,051   (239)   674   (228)                                     Other comprehensive income (loss)   1,486   (155)   2,243   753                                     Comprehensive income   $28,719   $21,881   $104,075   $88,889                         BALANCE SHEETS (In millions) (Unaudited)     June 30, 2025   June 30, 2024                     Assets         Current assets:         Cash and cash equivalents   $30,242   $18,315 Short-term investments   64,323   57,228                     Total cash, cash equivalents, and short-term investments   94,565   75,543 Accounts receivable, net of allowance for doubtful accounts of $944  and $830   69,905   56,924 Inventories   938   1,246 Other current assets   25,723   26,021                     Total current assets   191,131   159,734 Property and equipment, net of accumulated depreciation of $93,653 and $76,421   204,966   135,591 Operating lease right-of-use assets   24,823   18,961 Equity and other investments   15,405   14,600 Goodwill   119,509   119,220 Intangible assets, net   22,604   27,597 Other long-term assets   40,565   36,460                     Total assets   $619,003   $512,163                     Liabilities and stockholders' equity         Current liabilities:         Accounts payable   $27,724   $21,996 Short-term debt   0   6,693 Current portion of long-term debt   2,999   2,249 Accrued compensation   13,709   12,564 Short-term income taxes   7,211   5,017 Short-term unearned revenue   64,555   57,582 Other current liabilities   25,020   19,185                     Total current liabilities   141,218   125,286 Long-term debt   40,152   42,688 Long-term income taxes   25,986   27,931 Long-term unearned revenue   2,710   2,602 Deferred income taxes   2,835   2,618 Operating lease liabilities   17,437   15,497 Other long-term liabilities   45,186   27,064                     Total liabilities   275,524   243,686                     Commitments and contingencies         Stockholders' equity:         Common stock and paid-in capital - shares authorized 24,000; outstanding 7,434  and 7,434   109,095   100,923 Retained earnings   237,731   173,144 Accumulated other comprehensive loss   (3,347)   (5,590)                     Total stockholders' equity   343,479   268,477                     Total liabilities and stockholders' equity   $619,003   $512,163                 CASH FLOWS STATEMENTS (In millions) (Unaudited)     Three Months Ended   Twelve Months Ended   June 30,   June 30,   2025   2024   2025   2024                                     Operations                 Net income   $27,233   $22,036   $101,832   $88,136 Adjustments to reconcile net income to net cash from operations:                 Depreciation, amortization, and other   11,203   6,380   34,153   22,287 Stock-based compensation expense   3,073   2,696   11,974   10,734 Net recognized losses on investments and derivatives   56   44   609   305 Deferred income taxes   (2,221)   (1,145)   (7,056)   (4,738) Changes in operating assets and liabilities:                 Accounts receivable   (16,179)   (13,246)   (10,581)   (7,191) Inventories   (81)   55   309   1,284 Other current assets   (3,686)   (2,528)   (3,044)   (1,648) Other long-term assets   418   (1,240)   (2,950)   (6,817) Accounts payable   (652)   4,204   569   3,545 Unearned revenue   18,361   15,657   5,438   5,348 Income taxes   1,043   (806)   (38)   1,687 Other current liabilities   5,346   4,652   5,922   4,867 Other long-term liabilities   (1,267)   436   (975)   749                                     Net cash from operations   42,647   37,195   136,162   118,548                                     Financing                 Proceeds from issuance (repayments) of debt, maturities of 90 days or less, net   0   (1,142)   (5,746)   5,250 Proceeds from issuance of debt   0   197   0   24,395 Repayments of debt   0   (13,065)   (3,216)   (29,070) Common stock issued   548   534   2,056   2,002 Common stock repurchased   (4,546)   (4,210)   (18,420)   (17,254) Common stock cash dividends paid   (6,169)   (5,574)   (24,082)   (21,771) Other, net   (677)   (303)   (2,291)   (1,309)                                     Net cash used in financing   (10,844)   (23,563)   (51,699)   (37,757)                                     Investing                 Additions to property and equipment   (17,079)   (13,873)   (64,551)   (44,477) Acquisition of companies, net of cash acquired and divestitures, and purchases of intangible and other assets   (1,743)   (1,342)   (5,978)   (69,132) Purchases of investments   (21,631)   (2,831)   (29,775)   (17,732) Maturities of investments   4,618   1,557   16,079   24,775 Sales of investments   2,621   2,023   9,309   10,894 Other, net   2,642   (382)   2,317   (1,298)                                     Net cash used in investing   (30,572)   (14,848)   (72,599)   (96,970)                                     Effect of foreign exchange rates on cash and cash equivalents   183   (103)   63   (210)                                     Net change in cash and cash equivalents   1,414   (1,319)   11,927   (16,389) Cash and cash equivalents, beginning of period   28,828   19,634   18,315   34,704                                     Cash and cash equivalents, end of period   $30,242   $18,315   $30,242   $18,315                         SEGMENT REVENUE AND OPERATING INCOME (In millions) (Unaudited)     Three Months Ended   Twelve Months Ended   June 30,   June 30,   2025   2024   2025   2024                                     Revenue                                   Productivity and Business Processes   $33,112   $28,627   $120,810   $106,820 Intelligent Cloud   29,878   23,785   106,265   87,464 More Personal Computing   13,451   12,315   54,649   50,838                                     Total   $76,441   $64,727   $281,724   $245,122                                     Operating Income                                   Productivity and Business Processes   $18,993   $15,706   $69,773   $59,661 Intelligent Cloud   12,140   9,835   44,589   37,813 More Personal Computing   3,190   2,384   14,166   11,959                                     Total   $34,323   $27,925   $128,528   $109,433                                     We have recast certain prior period amounts to conform to the way we internally manage and monitor our business.